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In a move aimed at safeguarding the interests of homebuyers in Gujarat, the Gujarat Real Estate Regulatory Authority (RERA) has taken a proactive stance against unscrupulous builders who engage in soft launches or pre-RERA marketing tactics and accept bookings without obtaining the mandatory RERA registration number. This initiative seeks to curb a prevalent practice where developers offer units at discounted rates before securing RERA approval, a violation of RERA regulations that leaves buyers exposed to potential risks.
Instances of developers promoting their upcoming projects without obtaining the requisite RERA registration number have prompted the vigilant officials at RERA to take swift action. They have begun monitoring social media platforms to detect and address such activities. A senior RERA official emphasized the importance of adhering to Section 3 of the RERA Act, which mandates prior registration before selling or marketing a project. Violating this provision can result in penalties of up to 10% of the estimated project cost. Notably, in 2021, a developer faced a penalty of Rs 10 lakh for marketing a project in the GIFT City before obtaining the necessary registration, setting a precedent for stringent enforcement.
These pre-RERA marketing tactics have, in some cases, involved developers collecting cash from investors or buyers by enticing them with discounted rates for properties purchased prior to RERA registration. This practice not only raises concerns about the legality of such transactions but also exposes investors to potential risks. Some developers have gone to the extent of accepting payments through accounts that are not registered with RERA, as they await approval from the regulatory body. This trend has been on the rise, particularly among new builders entering competitive markets. These builders often offer reduced rates to attract investors before obtaining RERA approval, primarily to secure liquidity for their projects. However, this strategy has led to disputes and disagreements between developers and investors.
The Gujarat Real Estate Regulatory Authority's proactive stance in cracking down on pre-RERA marketing and unregistered transactions underscores its commitment to upholding the integrity of the real estate market and ensuring the protection of homebuyers' rights. By monitoring social media platforms and imposing penalties on violators, RERA aims to deter developers from engaging in these risky practices and promote a transparent and secure real estate environment in Gujarat.
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